NISM Series III-C flashcards

32 cards. Read the term and the definition here. The deck at the top of this page is optional.

SEBI Intermediaries Regulations 2008

Framework regulation prescribing registration, code of conduct, general obligations, record-keeping, and reporting requirements for securities intermediaries operating in Indian securities markets.

Form A application

Prescribed application form submitted to SEBI by an entity seeking registration as a securities intermediary, accompanied by the applicable non-refundable fee.

Form B registration certificate

Certificate issued by SEBI granting intermediary registration, containing specified details and valid for five years unless renewed before expiry.

Net worth requirement

Minimum capital threshold computed as paid-up capital plus free reserves less accumulated losses and intangible assets, prescribed per intermediary category and certified periodically.

Compliance officer role

Designated person responsible for monitoring regulatory compliance, handling investor grievances, and reporting material violations or non-compliance to SEBI.

Code of conduct fiduciary duty

Obligation to act in the client's best interest, avoid conflicts, maintain confidentiality, and make full and fair disclosure of material information.

Record retention period

Prescribed books, records, and client agreements must generally be maintained for at least five years and produced before SEBI on demand.

NISM certification requirement

Specified associated persons such as sales, dealing, and compliance staff must hold valid NISM certifications under SEBI's certification of associated persons framework.

Change in control reporting

Intermediary must notify SEBI of changes in control, directors, or material business changes as prescribed under applicable regulations.

Periodic returns

Scheduled reports and returns submitted by intermediaries to SEBI, covering financial position, compliance status, and business activity as specified.

Investor grievance redressal

Mandatory mechanism for receiving, resolving, and reporting client complaints, with escalation to SEBI where complaints remain unresolved.

Registration renewal

Application for renewal of intermediary registration must be made before expiry of the five-year validity, subject to continued compliance with eligibility conditions.

Fit and proper criteria

Eligibility standard assessing honesty, integrity, reputation, and financial soundness of the applicant, promoters, directors, and key personnel.

Prohibition on fraudulent practices

Intermediaries must not engage in manipulative, deceptive, or unfair trade practices and must comply with SEBI (Prohibition of Fraudulent and Unfair Trade Practices) Regulations.

Client agreement in writing

Intermediary must execute a written agreement with each client specifying rights, obligations, fees, and risk disclosures before providing services.

Segregation of client funds

Client funds and securities must be kept separate from the intermediary's own assets and used only for the purposes for which they were received.

KYC and client due diligence

Intermediary must identify clients, verify identity and beneficial ownership, and conduct ongoing due diligence under PMLA and SEBI KYC norms.

Suspicious transaction reporting

Suspected money-laundering or suspicious transactions must be reported to the Financial Intelligence Unit through the designated principal officer.

Principal officer AML

Designated officer responsible for implementing the anti-money-laundering programme, including monitoring, training, and reporting suspicious transactions.

Conflict of interest management

Intermediary must identify, disclose, and manage conflicts between its own interests and those of clients, including through Chinese walls and disclosure.

Chinese wall

Internal information barrier separating departments such as research and dealing to prevent misuse of non-public information and manage conflicts.

Insider trading prohibition

Intermediaries must prevent dealing on unpublished price-sensitive information under SEBI (Prohibition of Insider Trading) Regulations, 2015.

Code of conduct for intermediaries

Schedule of conduct requiring fair dealing, due diligence, confidentiality, avoidance of misrepresentation, and compliance with securities laws.

SEBI inspection powers

SEBI may inspect books, records, and operations of an intermediary and may direct corrective action or initiate enforcement proceedings.

Penalties and enforcement action

SEBI may impose monetary penalties, suspend or cancel registration, issue directions, or refer matters for prosecution for regulatory violations.

Grievance redressal escalation

Unresolved investor complaints may be escalated to SEBI's SCORES platform and thereafter to the appropriate grievance redressal mechanism.

SCORES platform

SEBI's centralised online complaint redressal system where investors lodge complaints against listed companies and registered intermediaries.

Maintenance of books

Intermediary must maintain accurate, complete books of account and records of transactions in the prescribed manner and preserve them.

Compliance with SEBI Act

Intermediary must comply with the SEBI Act, 1992, rules, regulations, circulars, and directions issued thereunder at all times.

Code of conduct confidentiality

Intermediary must keep client information confidential and not disclose it except with consent or as required by law or regulators.

Disclosure to clients

Intermediary must disclose all material information, including fees, charges, risks, and conflicts, enabling informed client decisions.

Associated person certification compliance

Failure of associated persons to hold required NISM certifications can attract regulatory action against the intermediary under certification regulations.